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FDI in telecom plunges in Apr-Jan period

By Religare

A deepening global economic slowdown and a tough policy environment took a heavy toll on Foreign Direct Investment (FDI) in the Indian telecom sector in the first ten months of the last fiscal.

FDI in the Indian telecom sector, which includes radio paging, cellular mobile, basic telephone services stood at USD 93 million in the April -January 2012-13 period, data from the Department of Industrial Policy and Promotion (DIPP) showed.


In the first ten months of fiscal 2011-12, the Indian telecom sector attracted USD 1.99 billion as FDI.

"Two things have impacted the inflows in the sector - the global economic slowdown and problems at the domestic front", a telecom official said.

The cancellation of the 2G spectrum allocation saga last year and uncertain policy environment has weighed on FDI inflows in the sector.

Industry officials reckon that the government must undertake immediate measures such as reducing the cost of spectrum, undertaking stable policies and regulatory regime to help revive the investment climate for the industry. For the whole of the 2012-13 fiscal, the sector is tipped have attracted FDI inflows worth a maximum of USD 100 million.

Overall FDI in India fell by nearly 39 per cent to USD 19.10 billion in the April-January period of fiscal 2012-13 as slowing economic growth dampened sentiment, exerting further pressure on the Indian currency.

Read more about: fdi telecom
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